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Setting up a company in Vietnam is the first and essential step for any individual or organization wishing to engage in legal business activities in the country. As one of the fastest-growing economies in Southeast Asia, Vietnam has become an attractive destination for both local entrepreneurs and foreign investors due to its dynamic market, competitive labor costs, and increasingly open legal framework. However, establishing a company in Vietnam involves a series of legal and administrative procedures that must be carefully followed in accordance with the Law on Enterprises and other related legislation.
1. Choosing the Type of Business Entity
Before starting the registration process, it is important to choose a legal structure that aligns with the scale, nature, and strategic goals of your business. Common types of legal entities in Vietnam include:
- Single-Member Limited Liability Company (LLC): Owned by one individual or organization; simple structure, suitable for small businesses.
- Multi-Member LLC: Has between 2 and 50 members; members are only liable up to their capital contributions.
- Joint Stock Company (JSC): Requires at least three shareholders; ideal for medium to large businesses with plans to raise capital or go public.
- Private Enterprise: Owned and operated by a single individual; personal liability is unlimited.
- Partnership: Includes at least two co-owners with joint and several liabilities.
The choice of entity impacts the company's ownership structure, tax obligations, reporting requirements, and fundraising options in the future.
2. Preparing Key Information for Registration
After selecting the business type, you must gather and finalize key details for company registration:
- Company Name: Must be unique and not cause confusion with existing businesses nationwide. It must include the business type and a distinguishing name.
- Registered Address: A clear and legal business address in Vietnam. Virtual offices are allowed in some cases.
- Business Activities: Must be listed according to the Vietnamese Standard Industrial Classification (VSIC) codes. Some industries are conditional and require special permits.
- Charter Capital: The total capital committed by members or shareholders. While most sectors have no minimum capital requirement, certain industries (e.g., banking, real estate, insurance) require legal capital.
- Legal Representative: A person responsible for representing the company in legal matters and daily operations. They must reside in Vietnam.
3. Preparing and Submitting the Application Dossier
The company registration dossier must be submitted to the Business Registration Office (Department of Planning and Investment) in the city or province where the company is located. The standard dossier includes:
- Application form for enterprise registration;
- Company charter (Articles of Association);
- List of members or founding shareholders;
- Valid identification documents of shareholders and the legal representative;
- Power of attorney (if submitted through an agent).
For foreign investors, the process includes an additional step of applying for an Investment Registration Certificate (IRC), as required by the Law on Investment.
4. Obtaining the Enterprise Registration Certificate (ERC)
Once the dossier is accepted and approved, the Enterprise Registration Certificate (ERC) will be issued within 3 working days. The ERC acts as the company’s legal license to operate and includes its business registration number, which also serves as the tax number.
However, receiving the ERC does not mean the business can immediately start operating. Several post-registration procedures must be completed first.
5. Post-Registration Procedures
After receiving the ERC, the company must complete the following click here steps to become fully operational:
- Company Seal: Create and declare the company’s official seal (can be a digital or physical stamp).
- Bank Account: Open a corporate bank account under the company’s name.
- Tax Registration: Register for electronic tax filing and obtain a digital signature certificate.
- Declare Charter Capital: Contribute the registered capital within 90 days from the date of ERC issuance.
- Business License Tax: Submit and pay the business license tax declaration.
- E-invoice Registration: Register to use Vietnam’s electronic invoicing system.
- Office Signage: Install a signboard at the registered business address.
- Social Insurance Registration: Register employees (if any) for social insurance and labor contracts.
6. Special Licenses (If Applicable)
For businesses operating in conditional sectors such as food & beverage, education, healthcare, e-commerce, construction, or logistics, additional permits and approvals (commonly known as “sub-licenses”) are required. These may include:
- Food safety certificates
- Fire prevention certificates
- Environmental impact assessments
- Industry-specific operational licenses
7. Timeline and Cost Overview
- Domestic companies: 3–7 business days for registration.
- Foreign-invested companies: 15–30 working days depending on complexity and industry.
- Costs: Vary depending on service providers, legal fees, and sector. Typically ranges from $200 to $3,000+, not including minimum capital.
8. Legal and Strategic Considerations
Foreign investors should be aware of Vietnam’s negative list—sectors that are restricted or prohibited to foreign investment. For allowed sectors, 100% foreign ownership is often permitted, but others may require a Vietnamese partner or have ownership limits. It’s strongly advised to consult with a local law firm or business consultant to ensure compliance and optimize tax and legal structures.
Additionally, having a solid business plan, choosing a strategic location (such as Ho Chi Minh City, Hanoi, or Da Nang), and hiring qualified local staff are critical for long-term success.
Conclusion
Establishing a company in Vietnam is a strategic move that offers long-term business potential in a growing and increasingly open economy. While the process involves multiple legal steps and documentation, it is relatively straightforward with proper preparation and local support. Whether you're a local entrepreneur or a foreign investor, understanding and following the correct procedures for company setup is essential for building a legitimate and sustainable business presence in Vietnam.
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